The Inequality of Lifetime Pensions

Research on social stratification has mostly focused on working-age populations. With rapidly aging populations increasing across the rich world, inequalities at older ages are an increasingly relevant part of how contemporary societies are stratified. Here, we highlight an aspect of inequality that has been largely unexamined—the inequality of lifetime accumulated pensions. In contrast to most previous research on old-age inequality comparing social groups, we focused on total-population-level inequality. Using Swedish register data covering the retired population born from 1918–1939, we found that lifetime pensions are much more unequal than pre-retirement earnings and yearly pensions. Our findings also show that the demographic driver—mortality—is the most important factor explaining the inequality of lifetime pensions within cohorts as well as its changes across cohorts. Pension policies can affect lifetime pension inequality, but such effects are limited in magnitude unless they directly affect the number of years of receiving pensions.